World Bank warns that rising demand and supply disruptions are pushing markets upward
According to the World Bank’s latest Commodity Markets Outlook (published on October 29, 2025), global fertilizer prices are projected to rise by around 21% by the end of 2025 compared to 2024 levels.
The increase stems from a combination of stronger demand, export restrictions, and higher input costs that continue to tighten global supply chains.
Key Numbers and Trends
- In Q3 2025, the fertilizer price index was already about 30% higher year-on-year.
- Average prices by product:
- Urea (nitrogen) – up 36.6% y/y to ≈ USD 461 / ton.
- Diammonium phosphate (DAP) – up 41% y/y to ≈ USD 554.8 / ton.
- Muriate of potash (MOP) – up 23% y/y to ≈ USD 286.9 / ton.
(Sources: World Bank, Agritech MEA, Ecofin Agency, Rabobank)
What’s Driving the Increase?
- Export Restrictions: China has tightened exports of nitrogen and phosphate fertilizers to secure domestic supply.
- Geopolitical Sanctions: Trade sanctions on Belarus and Russia—major suppliers of potash and phosphates—have constrained global availability.
- Higher Production Costs: Feedstock and energy (especially natural gas, crucial for nitrogen fertilizers) remain costly and volatile.
- Rising Global Demand: Farmers worldwide continue to push for higher yields amid food-security concerns, keeping demand strong despite higher costs.
Implications for Agribusiness and Farmers
- Farmers, especially in developing economies, face shrinking profit margins as fertilizer costs rise faster than crop prices.
- Importers and distributors (including companies such as Siman Ltd) must reassess logistics, sourcing, and pricing strategies to manage sudden price shocks.
- Food prices could see further upward pressure if farmers cut back on fertilizer use or cultivated acreage.
- For fertilizer suppliers, this is an opportunity to educate customers, offer forward-pricing or early-booking options, and strengthen supply-chain transparency.
What to Watch Next
- Whether China and Russia maintain or relax export limits in late 2025 – 2026.
- The trajectory of natural-gas prices, which heavily influence nitrogen fertilizer costs.
- Possible demand slowdown: Rabobank expects global fertilizer consumption to drop ~4% in 2025 due to affordability issues.
- Government responses, such as subsidies, tariff changes, or incentives for local production, could partially offset cost pressures.